By MARILYN CHASE and
GREG HITTStaff Reporters of THE WALL STREET
JOURNAL

Gasps erupted from an audience of microbiologists as one of the
government's top smallpox experts displayed slides of children covered with
disfiguring pockmarks at a meeting in San Diego last month.

The topic of his talk was bioterror, but the unsettling show-and-tell
wasn't focused on the threat of smallpox: it addressed the serious risks of
the vaccine meant to prevent it. "These are things the American public
needs to understand," said the speaker, Anthony S. Fauci, director of the
National Institute of Allergy and Infectious Diseases.

Life-Threatening Reactions

As President Bush struggles to figure out just who should get the
smallpox vaccine -- a possibly vital tool in the war on bioterror -- he
faces an excruciating dilemma because the vaccine itself is dangerous. It
causes life-threatening reactions in 15 of every million people vaccinated,
killing one or two of them. As many as 50 million Americans, including
babies, pregnant women, people with the common skin rash eczema, as well as
those with weakened immune systems, may be vulnerable to the vaccine's
risks.

"There is no vaccine with comparable risks," says Paul Offit, chief of
the infectious-diseases section of the Children's Hospital of Philadelphia.
He is also a member of an advisory committee to the Centers for Disease
Control and Prevention, which has posted decades-old photos on its Web site
of babies and children with inflamed skin lesions
(http://phil.cdc.gov/Phil/search.asp1). "I would never give that vaccine to my children because right now
there is no disease out there," he says.

Last year's anthrax attacks exposed weaknesses in U.S. defenses against
bioterrorism attacks and raised alarms that smallpox -- the once-deadly
disease believed to have been eradicated world-wide since 1980 -- could be
used as a weapon. U.S. officials fear that Iraq, which has attempted to
stockpile chemical and biological arms, may have obtained samples of the
highly contagious virus. With the possibility of military conflict looming,
they worry that Iraqi leader Saddam Hussein might use smallpox against U.S.
troops or even against civilians on U.S. soil.

One possibility now under discussion at the White House is an
extraordinary proposal to compensate victims injured by the vaccine. "The
president on down -- everybody -- recognizes in this life-and-death
decision that the president has to make, there will be some families that
endure losses and others that endure permanent injury," said Tom Ridge, the
White House's homeland security director, in a recent interview. "There has
to be some way to compensate them."

Liability Concerns

Details are still very much up in the air, but the proposed payments are
a feature of a larger plan to address liability concerns arising from a
vaccination initiative. The goal would be to provide protections against
lawsuits for health-care workers enlisted to carry out a federally
sponsored inoculation program.

RISKS OF INOCULATION

Results of a national survey of people vaccinated in 1968, four years
before the U.S. stopped its public smallpox-vaccination program.
Complications of the smallpox vaccine, per 1 million people vaccinated.

Sources: U.S. Centers for Disease Control and
Prevention; New England Journal of Medicine

The program favored by federal health officials would offer smallpox
vaccination to about 500,000 hospital workers viewed as being the most
likely to come into contact with victims of a domestic bioterrorism attack.
After that, firefighters, police and paramedics -- so-called first
responders -- would be offered the vaccine, bringing the total of those
inoculated to about 10.5 million people. Availability to the general public
would follow sometime in 2004. The vaccinations would be voluntary, federal
officials say, and accompanied by a public education campaign.

Smallpox is an ancient scourge that killed hundreds of millions of
people throughout its recorded 3,000-year history. It's earliest known
victim was Pharaoh Ramses V in 1157 BC. The disease begins with fever,
aches and nausea, and later develops into a rash that forms blisters. The
virus kills through overwhelming toxemia, or blood poisoning, and plunging
blood pressure. There is no known cure. The U.S. stopped vaccinating the
public in 1972, leaving people under 30 years old vulnerable and vaccinated
older Americans with waning immunity.

Still, many doctors shudder at the possibility of harm to their patients
should Mr. Bush give the go-ahead for a vaccination plan. "When one-half
million medical first-responders get vaccinated, there's a chance someone
will die," says Kaiser's vaccine center co-director Steven Black. "That's
going to sober people's enthusiasm."

Brutal Mishap

Dr. Black can't shake the memory of a brutal vaccination mishap he
witnessed during his medical training at the University of California at
San Francisco in 1975, when doctors were experimenting with the vaccination
for ailments other than smallpox. A Bay Area man had received the vaccine
in an attempt to control his herpes. Unbeknownst to the researchers, he
also had leukemia, which compromised his immune system. "It was horrible,"
Dr. Black recalls. "Ten days later he was dead."

Little about the smallpox vaccine has changed since it was developed in
the 18th century. It contains a live pox virus called vaccinia, which is
harvested from infected calf skin. The vaccine is particularly dangerous
because unlike most live vaccines, it uses virus that hasn't been weakened.
In most people, vaccinia causes a mild infection that triggers lasting
immunity. But in some people, the virus runs amok, and several hundred
people would be expected to die if a mass vaccination took place. Even
people with minor reactions to the vaccine can spread the vaccinia virus to
others. Such risks were deemed acceptable when smallpox was active and
killing 30% of those it infected.

But today, the risks might not be so universally accepted, and some of
the vaccine's casualties and their families likely would file lawsuits. Mr.
Ridge, bemoaning "this litigious world in which we live," said "well
meaning" professionals shouldn't face liability for administering "a
vaccine that the entire world knows will have, can have, some
complications." He said the administration could structure the compensation
payments and liability protections using Mr. Bush's authority under, for
example, the Federal Tort Claims Act.

Meanwhile, on Capitol Hill, lawmakers have begun to anticipate the need
for legislation to solve the liability problem. Congress could set up a
compensation fund similar to the one created in 1986 for those injured by
mandatory childhood immunizations. Another option would be for smallpox
personal-injury lawsuits to be brought only in federal court, before a
judge and not a jury. Also, punitive damages could be limited in such
cases.

The liability question was one topic discussed at a Sept. 3 meeting in
the Oval Office, attended by Mr. Bush, Mr. Ridge, Health and Human Services
Secretary Tommy Thompson and Vice President Dick Cheney. It was the second
meeting at which officials briefed Mr. Bush on a broad range of smallpox
vaccine questions, including availability of the vaccine and the size of
the population to be inoculated.

More than a month later, Mr. Bush's advisers still are struggling with
the decision and gathering information for the president. Some officials
describe a near-constant back-and-forth between the White House and the
government's health and security experts.

Mr. Cheney supports immunization of all U.S. troops headed to the Middle
East. He has kept private his advice to the president on possible
home-front efforts but has pushed analysts for "worst-case scenarios," in
an effort to weigh the pros and cons of widespread vaccination.

Accelerating the urgency of the public-health debate is the imminent
availability of enough vaccine to more than cover the entire U.S.
population of about 280 million people. One year ago, only 15 million doses
of Wyeth's Dryvax were on hand. Now,
tests show that it's possible to dilute those doses fivefold. Dr. Fauci
predicts success in stretching to over 300 million doses a batch of 75
million doses found in a freezer at Aventis Pasteur of Swiftwater, Pa., the
vaccine unit of Aventis SA of Strasbourg, France.
Augmenting those doses, made by the calf-extraction method, federal
contractors Acambis PLC of London and Baxter International Inc. are
readying more than 200 million doses made by cell-culture methods.

Other companies are trying to develop more benign vaccines using milder
strains of the virus, modified vaccinia Ankara (MVA) and Lister clone 16m8,
but they are years away. "Two shots [of MVA] might offer protection with
none of the side effects," says Dr. Offit of Philadelphia. "That would be
the best of both worlds. The question is, can you wait?"

Volunteers Weigh Risks

Currently, only volunteers in clinical trials face the disturbing
calculus of risks versus benefits of the vaccine. Under those tightly
controlled conditions, doctors are going to extraordinary lengths to avoid
the vaccine's side effects and make sure patients know what they're getting
into. Of 1,400 volunteers screened at a recent trial conducted by Kaiser
Permanente Vaccine Study Center in Oakland, Calif., all but 47 dropped out
because of disqualifying medical conditions or concerns after they learned
about the vaccine's risks. Only minor side effects have been seen so
far.

As part of a new Kaiser trial, Theodore Stroll, a 46-year-old staff
attorney for the California Supreme Court, underwent a 40-minute telephone
briefing, which probably wouldn't be possible under emergency conditions in
the event of a bioterrism attack. A nurse explained the risks of the
experiment, which is testing three different strengths of Dryvax vaccine as
part of a study sponsored by the National Institutes of Health.

Along with routine blood work and a physical exam, Mr. Stroll was tested
for the HIV virus and Hepatitis B and C. He read and signed a 10-page
document, in which everything that could go wrong was spelled out. He
verified he doesn't live with anyone who is pregnant, has eczema, suffers
from impaired immunity, or is under one year old.

Last Wednesday, Mr. Stroll was inoculated, after more tests and
counseling. Inserting the needle into a vial of vaccinia virus, nurse Joy
Fournier gently spread a droplet of vaccine on his upper arm, adjacent to
an old smallpox vaccine scar. Then she punctured a dime-sized area of the
skin with about 15 needle pricks. She sealed the site with a special
dressing to keep the virus from spreading to other people and presented Mr.
Stroll with a diary so he could record common symptoms such as fever,
nausea, aches or fatigue. She also told him not to take a bath or swim
until the scab fell off in several weeks.

Mr. Stroll had been vaccinated for smallpox three times in childhood
with no problems. "I'm convinced we face a threat of biowarfare," he said,
adding it's better to be vaccinated now "than in a [subway] station under
emergency conditions."

Scared by last year's anthrax attack, many people are demanding the
vaccine at clinical trial sites, putting pressure on officials to make it
available. Greg Poland, director of the Mayo Clinic Vaccine Research Group
in Rochester, Minn., says that his continuing trial can enroll only 120
people, but "our lab gets a call every two minutes." He says he has moved
vaccine stocks offsite because of security concerns.

"My lab is the only one locked and secured at this institution because
people want this vaccine," he says. "We've had people hack into our
computer to find out where to get it." Dr. Poland also worries volunteers
may lie to get the vaccine.

How far to go in explaining the risks to people who want the vaccination
has sparked considerable debate among medical professionals. Dr. Poland
says he considered showing pictures of people with bad reactions to trial
volunteers. "My initial feeling was, let's show them," he says. But he
bowed to a co-worker's protest that the pictures were too emotionally
charged. Instead, he says he'll direct volunteers to CDC's Web site.

But graphics can also hamper decision-making, says Robert Belshe, a
vaccine researcher at Saint Louis University Medical School in St. Louis,
Mo. "The key element of informed consent is providing a fair and balanced
picture of risks and benefits," he says. If you show an emotionally charged
photo of a baby with disfiguring pock marks "you're introducing a bias that
may not be fair. One just as easily could go the other way, and show stacks
of bodies of people who died because they didn't get vaccinated."

One problem facing doctors is how to manage the millions of Americans
with a history of eczema if vaccines are made available before an actual
smallpox outbreak. According to trial guidelines, the common rash is a bar
to receiving the vaccine, which can fuel a flare of eczema vaccinatum, an
oozing swath of viral lesions. "It itches like mad. You scratch the lesion.
You touch yourself, or somebody else," says Dr. Poland.

Allergists estimate up to 20% of the population has suffered from
eczema. "Part of the problem is that historically eczema was a 'wastebasket
diagnosis' -- lots of kids got labeled that don't fit the diagnosis," says
Dr. Poland. "But what do I do when I see in someone's chart that an urgent
care doctor once made that diagnosis in the 1970s?"

For now, the nearly one million Americans with HIV/AIDS are barred from
smallpox vaccination as well because their immune systems are compromised.
Many Americans with HIV don't know they are infected. This makes wider HIV
testing particularly important, according to vaccine experts.

Of course, in the case of an actual bioterror attack, all bets are off.
In a briefing last week, Walt Orenstein, director of CDC's national
immunization program said that in the event of a smallpox outbreak or
bioterror attack, people with eczema or HIV who had been in contact with a
smallpox patient likely would be vaccinated.

Health officials also have laid plans for a rapid response to any direct
attack. They've prepared a strategy, relying on states for distribution, to
inoculate every American within five to seven days of an outbreak.